It was a fiery Prime Minister’s Questions this week: with Nick Clegg standing in for David Cameron, Labour’s deputy leader Harriet Harman was joined by her backbenchers in hurling insults at the Lib Dem leader, which he returned with equal force.

It wasn’t edifying or enlightening. And it may not be a good guide to what could happen after May 2015 if the electoral arithmetic leaves Labour and the Lib Dems with little choice but to team up to form a Coalition government.

In fact, if you review the policies announced by both the Lib Dems and Labour over the past year or so, it is clear that the two parties now agree with each other on a range of major policy areas. With the Lib/Con Coalition running out of steam, Nick Clegg and Ed Miliband are beginning to sign from the same hymn-sheet.

Here are the 17 policy areas where I think it’s straightforward to imagine the two parties reaching agreement…

Tax-cuts for low-earners

This has been the signature Lib Dem policy delivered in Coalition: raising the personal tax allowance has lifted two million of the lowest-paid out of income tax altogether and given a sizeable tax-cut to 22 million other tax-payers. The party voted last September to go further, and increase the tax-free allowance to £12,500. In February 2013, Ed Miliband announced Labour too would commit to tax-cuts targeted at the low-paid by re-introducing the 10p tax rate (which has the virtue of being cheaper and the vice of being less progressive). It’s not hard to see the two parties reaching an agreement on this.

A mansion tax

Vince Cable’s idea has its critics, not least David Cameron who blocked a Clegg/Osborne deal in 2012 which would’ve seen the mansion tax introduced in exchange for the Tories cutting the top-rate of tax from 50p to 40p. Ed Miliband has already announced Labour would introduce an annual levy on houses worth over £2 million.

Scrap the marriage tax-break

Nick Clegg has consistently denounced the Tories’ marriage tax break as an “unmarried couple penalty”. A Lib Dem abstention on the issue was written into the Coalition Agreement, and when it was announced last autumn Clegg also managed to negotiate the introduction of universal free school meals for all infants in return. Ed Balls vowed yesterday to reverse the tax.

Cut pension tax relief for high earners

The Lib Dems voted last September to reduce the lifetime tax-free limit on pension contributions from £1.25m to £1m. Labour this week announced that those earning more than £150,000 would get only 20% tax relief on pension contributions, instead of the 45% they receive now. The Lib Dems are ‘in principle’ in favour of moving to a single rate of relief though recognise there are many practical problems. But clearly there’s space for agreement here.

Scrap the bedroom tax

Officially the Lib Dems are committed to an immediate review of the impact of the ‘bedroom tax’ (or ‘spare room subsidy’ as no-one calls it), including looking at what money (if any) has been saved, the costs incurred, and the effect on vulnerable tenants. However, party president Tim Farron has made no secret of his wish to reform / scrap it. Ed Miliband announced at the last Labour conference that any government he led would scrap it.

Every teacher to have a teaching qualification

Nick Clegg issued his parental guarantee last October, arguing that all schools, including academies and free schools, should only employ teachers with a teaching qualification or working towards one. Labour would go further and require teachers to be licensed, but again there’s plenty of room for accord here.

Schools to have local accountability

The ‘academisation’ of schools has severely weakened local education authorities, with nothing now standing between thousands of academy schools and Whitehall. David Laws has long voiced concerns about this centralisation of power, especially for primary schools, and advocated some form of locally accountable middle tier.
David Blunkett is currently leading a review for Labour’s shadow education secretary, Tristram Hunt, on this very issue. Between the two, some form of locally accountable middle tier is likely to emerge.

Cut back wealthy pensioner benefits

It’s a couple of years since Nick Clegg boldly staked out his view that it was time to means-test better-off pensioners and end universal entitlement to benefits such as free bus passes and television licences. Last summer, Ed Balls announced he would axe winter fuel benefit for the most well-of pensioners.

In/out referendum on Britain’s EU membership

At the Lib Dems’ September conference, party members approved the policy of an in/out referendum being held the next time there’s a proposal for a significant transfer of powers from the British parliament to the European Union. This week Ed Miliband announced Labour is adopting the same policy.

More houses and more council housing

At the party’s 2012 conference, the Lib Dems committed to a target of 300,000 new homes each year by supporting private investment and by giving greater powers to local councils and social landlords. Labour’s stated target of 200,000 new homes a year is more modest, but there is considerable overlap in means, such as through new garden cities and increased borrowing powers for councils.

Environment: 2030 decarbonisation target

One of the largest (and least commented-on) Lib Dem rebellions took place last June when 16 Lib Dem MPs rebelled against the Government and voted for a carbon emissions target for the power industry. Lib Dem energy secretary Ed Davey made clear that a decarbonisation-by-2030 target will be in the next Lib Dem manifesto even if it couldn’t be agreed within the Coalition. Labour has confirmed this will be in their party’s manifesto too. And though Ed Davey has clashed with Ed Miliband on Labour’s proposed energy price freeze, that hasn’t stopped him also calling for a re-setting of the energy market to ensure fair prices for consumers.

Trident

The 2013 Lib Dem conference backed a policy calling for a reduction in the number of Trident submarines while still maintaining the UK’s nuclear capability. Though Labour has attacked the Lib Dem plans, arguing that the UK should renew Trident and maintain a continuous-at-sea nuclear deterrent, the Lib Dem rejection of unilateralism means this is unlikely to be a red line issue.

Health and social care integration

The integration of health and social care has long been a passion of Lib Dem health minister Norman Lamb, who has argued for “mov[ing] the NHS away from top-down re-organisation … towards a more integrated health service [that] will stop people falling through the gaps in the system”. This passion is shared by Labour’s shadow health secretary Andy Burnham – which means that NHS reform might prove a whole lot less contentious under a Lib/Lab coalition.

Defence of the European Court of Human Rights

One of the Coalition divides which might prevent a second Lib/Con coalition is the Tory party’s determination to scrap the Human Rights Act and consider withdrawing the UK from the European Court of Human Rights. This was one of 16 Tory policies that Nick Clegg told the Lib Dems’ 2013 conference he had vetoed, while Labour’s shadow justice secretary Sadiq Khan has also attacked the Tories’ position.

Devolution of public services to local communities

Devolution of power to the most local level achievable is a Lib Dem touchstone: the party of ‘home rule’ has rebuilt its strength from the bottom up in the last half-century. Nick Clegg has drive through the Coalition’s “City Deals” programme, offering greater independence from Whitehall. Last weekend the party voted through a motion at its Spring conference called ‘Power to the People‘. A month ago Ed Miliband spoke up for “people powered public services”. We’ll see if he means it if/when he’s in power – but he could certainly count on Lib Dem support.

Greater transparency of intelligence agencies

There was an odd synchronicity last week. Here was Nick Clegg on 3rd March arguing in The Guardian for “a significant revamp of the oversight applied to our intelligence agencies, [which] should be introduced as quickly as possible”. And here was Labour’s shadow home secretary the same day arguing for “flexible, independent and transparent” processes to oversee the UK’s security systems and “reassure the public that a good job is being done on its behalf”.

Political reform

This is the one Lib Dem priority within the Coalition which has largely been unfulfilled, with the defeat of voting reform, House of Lords reform and party funding reform thwarting Nick Clegg’s over-ambitious pledge to introduce the “greatest shake up of our democracy since 1832”. Yet on all three issues Labour is, ostensibly at any rate, on the same side as the Lib Dems. Add to that votes at 16 – which Labour wants in place by 2016 – and there is a shared agenda if Miliband can persuade his party’s backbenches to back him.

So there you go… 17 areas of potential accord.

But Lib Dems looking down this list and thinking “Those all look good, I’d like us some of that” should be wary. As I observed a few months ago:

… the Lib Dems have been lucky twice-over in partnering with the Conservatives. [The Tories] have allowed us to frame ourselves as the defenders of fairness in government. [The Tories] have allowed [themselves] to become defined as the ‘bad cops’ in the opinion of most voters.

We wouldn’t be that lucky with Labour, though: they would do their utmost to ensure it was the reds who got the bragging rights for defending the downtrodden and the dispossessed, the yellows who were seen as heartless scourges of the poor. However much we raised the fairness stakes, you can bet Labour would out-bid us. Though perhaps they’d make some concessions on civil liberties to ensure they can blame us for any terrorist outrages.

According to our LibDemVoice surveys of card-carrying members, my party would much rather do a deal with Labour next time around. I understand why and we should, of course, keep our options open: what smart negotiator doesn’t? Especially as it’s the voters who’ll decide what’s possible and what’s not. But we should be very careful what we wish for, otherwise it will be the Lib Dems that end up branded as the nasty party in any future Lib-Lab coalition. We can’t always rely on being so lucky as we have been with the Conservatives.

24 Comments

An excellent piece! A coalition with Labour after 2015 would of course unblock lots if the sticking points that have bothered the Lib Dems in the current government. There is a sense that the grass will suddenly be greener.
However, the parallel discussion would be the government programme of a Conservative / Lib Dem coalition in the next parliament. A harder discussion perhaps, but also a potentially very constructive one. For example, all the work done by Vince at BIS on long term economic growth could, it can be argued, be continued much more effectively within a shared Con / Lib Dem agenda.
And, of course, it’s up to the electorate…..

Stephen Tall’s quoted personal observations from a few months ago may just tell us that he was wrong a few months ago and that he is still wrong now. Being consistently wrong has the merit of being consistent . It does not tell us much else. Like some others in the party he may have just got stuck in the rut of attacking Labour whatever they do or say.
After four years of this government it is possible that the voters are no longer going to swallow the line “it is all the fault of the last lot”. This is especially so as a large proportion of the voters know that the international banking crisis of 2008 was exactly that, international. Blaming it on Brown and Labour does not wash any more with huge numbers of voters, they are not that stupid.

“In February 2013, Ed Miliband announced Labour too would commit to tax-cuts targeted at the low-paid by re-introducing the 10p tax rate (which has the virtue of being cheaper and the vice of being less progressive).”

I suppose it was inevitable that Labour should desire to rebuild its client-state, where everyone pays tax and gets a raft of back-handers in return.

I think the lib-dem method is a lot cleaner, both fiscally and morally.

I’m with Jedibeeftrix; I don’t want to see a return to the Labour nonsense of universalism in Welfare and Taxation.

I also don’t believe, after these years in opposition, that Labour are capable of accepting coalition. I don’t think Miliband can carry the support of his MPs for a coalition, and I don’t think their activist base could cope with it having had “four years of hate” via their party establishment decrying us as quislings.

Trident unlikely to be a red line issue? When we don’t want to renew it as is and Labour have – so far – backed the no-change CASD line? We’ve been lucky this time round, because it was just possible to postpone the major decision until 2016, so the argument hasn’t come to a head. If a LibDem/Lab coalition fudged the decision soon after the election it would be Labour “back to the bad old ways of expensive indecision” and LibDems the minority position “making Britain unsafe”. That wouldn’t be a good position for anybody.

Of course I’d go back to unilateralism, but with the policy position as it is, this is one of the 17 about which there would – and should – be major argument. It can’t be thankfully, complacently put off again.

After having engaged in debate on this website occasionally since the advent of coalition I have been forced to the conclusion that the prime reason for the existence of the Liberal Democrats is to hate Labour and anyone who dissents from that hatred. Promoting liberalism comes way behind this hatred and way behind self-promotion. I would be stunned if Lib Dem MP’s and leadership were ever to form a coalition with Labour as it would entail a complete volte face on the bile that they have spewed and would be impossible to trust.

I agree with this article, but there is a recent precedent of us working well with Labour and that is in Scotland (note we were not villified for doing so by the press or by the electorate). We were able to get many reforms through e.g. proportional representation at local level (which I think we should have negotiated for the recent coalition). My view is that the recent coalition has caused an identity crisis in the public’s mind on whether we are centre right or centre left, but for a vast majority we are a centre left party. Therefore, if a coalition happens next time, in my view a coalition with Labour is best for our long term future. However, that depends on what the public vote and they are the masters!

If Labour and the Liberal Democrats agree about so much, and Labour have the possibility of forming a majority government and the Liberal Democrats don’t, what is the incentive for any voter who agrees with these policies to vote for the Liberal Democrats? You seem, by emphasising the similarity between yourselves and Labour, to be torpedoing your own electoral prospects.

I see the best one – constitutional reform – was left until last. The two referenda :- on setting up the citizens’ jury – and assuming a Yes vote in that and assuming the Jury thinks change is necessary – a second referendum (Yes or No) on the recommended package of reforms. That should be the bedrock of any negotiations on a coalition … with anyone. That is something Labour’s dinosaurs and their baby raptors will surely want to scupper. But without it nothing substantial will change.

If there is a coalition next time, you can bet it’ll take longer than 5 days to arrange. But I don’t buy the argument that either main party would prefer a minority government; give em’ a sniff of power and they’ll find excuses to make the deal. What we need to be careful on is that they might set the terms so high (something like the Tories making leaving the EHCR a red line issue) that we couldn’t accept, and then blaming us for collapsing the deal.

As Stephen says, there are many areas of agreement we could work on with Labour, the problem would be where they want to repeal (or at least condemn) actions of this Government such as the NHS bill. How do we handle that?

Where there really is no agreement on red line issues e.g. trident, I’d propose a series of simultaneous referendums to settle them (possibly including Heathrow 3rd runway, mansion tax, pensioner benefits, and yes EU membership if with the Tories) with coalition parties free to campaign on these but politically bound to support the outcome being implemented. It would allow the coalition to focus on areas of agreement which they can work together on.

What is the point in voting Lib Dem? Are they going to break through and win a majority by being Labour or Tony Blair light? No. People dream about changing the electoral system and sitting in the Commons with little real power, but I think that kind of attitude is a turn off to voters. It gets to the stage where the party is trying to serve itself, rather than than mutually serve itself and the public.

It’s true there is a great deal of common ground between the two parties – inevitably after the next election if a coalition between LibDems and Labour is practical, it will occur (even if a Tory/LD coalition is also practical, I suspect). However, let’s not lie about both parties policies about an EU referendum. Although the parties do share a policy, that policy is to never offer an EU referendum and lie about their policy to the voters.

Not sure I share Stephen’s view that the Tories have allowed us to play good cop. I think that from their angle they are getting to play at being a tough ones and we the weak ones. This chimes in with their narrative and highlights all the compromises we have had to make whilst diminishing all of theirs. Its true that Labour will try to portray us as the bad cops in any coalition, but that doesn’t mean we will have to play along.

My impression has always been that the Lib Dems take on the Tories under Queensbury rules, but that with Labour its more like WWF no-holds-bared grudge match. However whether that really portrays a difference in opinion or simply different facts on the ground I don’t know. One also gets the impression that we are, as a party, still very bitter about the Lib Lab pact of ’77-’78 – an event that took place 8 years before I was born.

Eddie the point of voting LibDem where I live is to get a local man elected instead of a parachuted in Tory from London. Unfortunately because the Tory and Labour parties fought against the minimal AV option, and some LibDems because it was not true PR, tactical voting is still alive and well.

Peter Hayes
I note you’re a party member, and yet the only point of voting LibDem is so that you can get a “local man”? So if the Tories were to adopt a local candidate next time round — and the Lib Dems, horror of horrors, picked someone who hasn’t lived “round here” since he were a nipper — then you’d give up the yellow bird for the blue torch (or whatever they’re waving these days)? Well, it’s a principle, I suppose, but a pretty poor one, in my eyes.

Peter, I see. However, I think the Lib Dems need more positive reasons to vote for them. It’s like what happened to Denis Healey: “why should we vote for you?”, “Because you have no where else to go”, “Found somewhere else to go”.

There are clearly major issues, particularly around civil liberties, where Liberal Democrats and Labour disagree. There is also no sign that Labour intends significant devolution of power beyond Scotland and Wales.

Your comment on electoral reasoning may seem logical, but the voters don’t seem to think that way. For example, in 1997 and 2001 there was clearly a lot of common ground between Labour and the Liberal Democrats, and in 1997 particularly Paddy Ashdown had obviously and correctly abandoned equidistance. Many commentators thought our vote would collapse in 1997 because apparently Tony Blair was pretty much about what we were about (that was their blinkered view) or in 2001 because reportedly Labour was delivering on the sort of things we’d argued for. Result? In 1997 we had our big breakthrough in terms of seats (despite a small drop in our vote) and in 2001 our votes and seats went up. Of course, there is one blindingly obvious reason why we should still expect to get votes if we’re perceived as being close to Labour – anti-Tory tactical voting where it’s clear that we and not Labour could beat the Tory.

@Simon Banks “There is also no sign that Labour intends significant devolution of power beyond Scotland and Wales.”
Didn’t Labour hold a referendum in which voters rejected devolution in northern england?

I feel the Liberal Democrats have failed in their objectives. They have voted with the Cons over major issues. They have failed to promote tax issues. They have failed to stop insidious bureaucratic, obtuse management led, not ground floor effective change led, changes to the NHS and the education system. They have endorsed the politicisation of the police force and made the armed forces reliant on outdated, poor and not enough equipment, through the mismanagement of conservative and liberal democratic penny saving twots. We have had privileged and elitist minded children take on the role of governing Britain if not the UK as a whole. Clegg as a leader has fumbled and dropped the ball. He needs to get out of the ball park. Ed Miliband is unclear as to what Labour needs to stand for; I am not convinced we need a Labour Party now, and certainly not one led by Ed Miliband and Ed Balls. Cameron must be laughing all the way ready for 2015. There is no real opposition to him and his kind. Pity. I think we all had high hopes, unrealistic as that was, of Clegg doing the right thing. He bumbled like a school boy in the EU debate with Farage, How could he have been so obtuse? I’m sorry but the LibDems will not get the same chance again. It will be a two horse race, unless UKIP steps up, and that is unlikely. So sad.

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